Out-of-State Real Estate Investing: States with Highest Percentage of Out-of-State Investor-Owned Properties

  1. Vermont 47%
  2. New Hampshire 43%
  3. Delaware 35%
  4. Arizona 33%
  5. Maine 29%
  6. Nevada 28%
  7. New Mexico 27%
  8. Wyoming 27%
  9. Florida 26%
  10. Idaho 24%
  11. Montana 24%
  12. Connecticut 20%
  13. New Jersey 20%

The above list reflects the states with the highest percentage of out-of-state investor-owned, tenant-occupied properties. As shown, at least 20% of the housing inventory in these markets is non-owner occupied, likely indicating investment properties according to RentRange® data evaluated after filtering out vacation homes. Out-of-state real estate investing is a strategy many investors apply when they live in an area with an unfavorable rental or housing market.

What are the drivers?

Home Prices and Rental Rates

Housing prices are on the rise in most of the above markets. For example, Concord, NH has seen a 19% increase in housing prices over the last five years. On average, a 3-bedroom single-family home is in the $220,000 range. Rents in this metro have also seen a major increase, about 23% since 2011. The spike in Nevada metros is even more pronounced, with home prices appreciating upward of 60 -100% and rental rates spiking by up to 35% over the last five years. In the Phoenix-Scottsdale metro, home prices have appreciated even more, at a whopping 104%!

Population and Job Growth

In growing markets like Miami, the 6 million person population grew by another 75,000 residents in 2015 and over 54,000 new jobs were created. When evaluating a new market, investors try to get an overall snapshot of the economic and demographic drivers in order to gauge overall investment opportunity. Miami is a great example of a diverse market, where prominent sectors include the retail trade, healthcare and food services industries.

When investing in out-of-state real estate, making data-informed decisions helps investors choose the right markets that best match their investment criteria. If you are interested in learning more about investment opportunities in out-of-state markets, the Investability® team and our friends at the Investment Community of the Rockies are ready to help. Be sure to check out upcoming regional events put on to empower investors to break into top rental markets around the country!

BlogMichael Shai